Craig Johnson, Clark.com
You know the routine: You trudge to the mailbox and retrieve the mail after a long day at work. As you make your way back inside, you glance at the assortment of white envelopes and stop at the one that looks like a bill. But beware — it could be an auto warranty scam.
Consumers beware: Auto warranty rip-off looks just like a bill
The return address looks legit, as does the packaging. As you open it and scan the contents, you see dollar amounts that quickly lead you to believe that you need to fork over some money because, well, this is a bill!
Only it isn’t. It’s just part of a trend in which companies are mailing correspondence to look exactly like bills. They’re hoping you don’t look too hard and feel like throwing them some money or your information. It’s a scam.
Money expert Clark Howard says while the letter is designed to look like a bill the truth is that “it is a solicitation to sell you a piece of garbage-pretend-extended-service-contract on your vehicle.”
The thing is, if you contact them or fill one of these forms out, you could give them personal information about you that they don’t otherwise have. “They don’t know what vehicle you own usually. They don’t know anything about it or whatever,” Clark says.” It’s all about trying to get you to call.”
The second page of the letter shows an itemized list of would-be repairs meant to frighten you into signing up, Clark says.
“This one has a scare sheet that shows how much various repairs cost on vehicles and how any of these can destroy my budget and that I just need to buy this thing,” he says.
Finally, Clark says: “I want you to know this: When you should buy an extended service contract from one of these solicitations that come in your mailbox is…the middle Tuesday of Never, Not Ever!”
All types of mail scams are back in vogue so it shouldn’t be surprising that the ol’ auto warranty scam pops up every now and again. But you may be wondering whether buying extended auto warranties are worth it.
Here’s Clark’s advice on buying auto warranties
- Never buy an extended auto warranty from a third party: “They are not legitimate coverage for your vehicles,” Clark says. “The companies are generally not going to honor the terms and conditions of what you paid money for.”
- If you absolutely must have an auto warranty…“You only should ever buy those from the vehicle’s manufacturer,” Clark says. “No one else. They’re the ones you want standing behind the vehicle you are driving.”